A Cost-Effective Way to Convert Buildings from Gas to Electric

Anton Petrus via Getty Images

Connect with state & local government leaders
 

Connecting state and local government leaders

COMMENTARY | Strategically decommissioning, or “pruning,” portions of the gas system could offer a cost-effective and coordinated approach to convert whole neighborhoods from gas to electric.

America’s journey to a carbon-free future will require getting natural gas out of buildings. That effort just got a boost from the Inflation Reduction Act, which offers billions of dollars of incentives for building electrification.

While the process of converting individual homes and buildings from gas to electric is well known, it can be slow and expensive. Plus, as more buildings turn off their gas connections, fewer and fewer customers will shoulder the cost of maintaining the gas infrastructure, boosting gas bills for remaining customers.

A coordinated approach, where portions of the gas system can be taken offline, while the buildings they serve are fully electrified could save all ratepayers money and provide the basis for a strategic and equitable transition to an all-electric future.

But such an approach has never been tried at scale and raises several questions. To start getting answers, East Bay Community Energy, or EBCE, is participating in a new research project funded by the California Energy Commission to explore strategic decommissioning or “pruning” portions of the natural gas system and using the savings to convert buildings to all electric.

Benefits of Pruning

Strategic decommissioning involves identifying portions of the natural gas distribution system due for upgrades or repairs and taking that portion of the distribution system offline instead. This involves immediately converting all customers served by that part of the system to electric energy only so the gas line can be capped off.

Pruning creates several benefits compared to the current strategy of incentivizing one building at a time. It avoids the cost of having to repair or replace gas lines and allows those saved funds to be redirected to building electrification. Similarly, pruning helps avoid the cost and disruption of ripping up streets in the future.

Map of major lines in the PG&E gas distribution network. Smaller distribution lines run to virtually every building. Source: PG&E.

Lastly, as customers leave the gas grid, those remaining behind pay an increasing share of the fixed costs, like repairs and paying off debt. These higher costs can fall on those who can least afford it. A deliberately planned transition away from the gas system can mitigate such impacts, making it fairer to all.

Complications of Pruning

Trying to convert all the buildings in a neighborhood simultaneously is complicated. The first is the high cost of converting existing homes. Data from 1,880 recent installations in California found an average cost for electric heat pumps for space heating and cooling of $17,287. Full electrification can also involve replacing a water heater, oven and dryer, and frequently upgrading the home’s main electric panel.

The second is the classic “split incentive” problem for apartments and rented homes, where the building owner pays the cost of appliances but the tenant pays energy bills. (Forty-six percent of housing units in our county are rented.)

And then there is the need to convince every single customer on a gas line to voluntarily go electric. Research shows that customers have little preference for gas over electric when it comes to space heating, water heating or dryers—provided they have heat when they want it. But some customers are attached to gas cooktops in their kitchen and won’t easily want to give them up.

Lastly, switching to electric will drive up electricity demand in neighborhoods, especially for winter space heating. This could require an upgrade in the electric distribution grid. The municipal utility for Palo Alto looked into this question, estimating the utility costs of converting from gas to electric. Upgrading their electric distribution system would increase their capital improvement budget by about 10%. Decommissioning their gas infrastructure would run from $11 million to $54 million but would save a total of between $26 million and $34 million over ten years by not having to replace gas mains and service lines.

Incentivizing and Evaluating Pruning

To test the pruning strategy, EBCE is working with researchers on the Targeted Gas Decommissioning Project. The project will develop methods to identify opportunities in the gas grid, then find three pilot sites in EBCE’s territory. Then, the research team will engage customers and local communities on the switch from gas to electric, with an eye toward environmental justice and equity. Finally, the researchers will report back to stakeholders and policymakers within and beyond California on barriers and how to address them, funding sources and recommendations for next steps.

Gas pruning can build on several efforts already underway. The California Energy Commission is using a “market transformation” approach that works upstream with manufacturers, distributors and vendors to seize on the benefits of transitioning to electric energy, and downstream through consumer education and contractor training. Another program provides technical assistance and incentives to home builders for new all-electric low-income residential buildings.

BayREN, the Bay Area administrator of public energy efficiency funds, offers rebates for electrification and energy efficiency upgrades. And EBCE’s local programs offer incentives for the installation of heat pump water heaters and commercial induction ranges, and lends electric induction cooktops through local libraries. New federal funds from the recently passed Inflation Reduction Act will help accelerate and expand these efforts. 

While electrification may not be easy, the fight against global warming demands it. Being proactive can help make it cheaper, faster and fairer.

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.